ACFE Insights

ACFE STAFF

In April 2018, the ACFE released the 2018 Report to the Nations, which provided a global analysis of the costs and effects of occupational fraud (i.e., fraud committed against the organization by its own officers, directors, or employees). The report highlighted the tremendous impact occupational fraud has on organizations throughout the world.

In a new sub-report, we now focus more closely on how occupational fraud impacts organizations in the Asia-Pacific region. This study is based on the 220 cases of occupational fraud from Asia-Pacific countries that were reported in our 2017 Global Fraud Survey. Collectively, these cases, which accounted for 11% of all cases in our global study, caused a median loss of USD 236,000 and lasted a median 18 months before they were detected.

This report contains information on fraud losses in the Asia-Pacific cases we analyzed, along with the methods of fraud committed, the ways in which the frauds were detected, the characteristics of the victim organizations and their anti-fraud controls, the characteristics of the fraud perpetrators and the results of the cases after the frauds had been discovered.

Here are few of the key findings from the report:

More than half of the cases in the region involved some form of corruption (bribery, kickbacks, illegal gratuities or conflicts of interest). Corruption was more than twice as common as the most frequent types of asset misappropriation, such as theft of noncash assets and fraudulent expense reimbursements.

The most common detection method was by a tip (47% of cases), with more than half of these tips coming from employees of the victim organization.

Occupational fraud losses are strongly correlated with the fraudster’s level of authority. The median loss in frauds committed by owners/executives was USD 1,000,000, which significantly higher than losses caused by managers (USD 323,000) and employees (USD 58,000).

The longer a fraud perpetrator has been employed by the victim organization, the more money they are able to steal. Fraudsters who had been with their organizations for more than five years stole four times as much as fraudsters with five years’ tenure or less.

Most victim organizations are unable to recover their losses after a fraud has occurred. 54% of victims in the study never recovered any losses.

Find more trends and analysis from the Asia-Pacific region, as well as download other useful infographics at ACFE.com/RTTNresources.